Bank of America Urges Retreat From Risk Assets as Bull-Bear Gauge Hits 9.7
Updated
Updated · CNBC · Aug 7
Bank of America Urges Retreat From Risk Assets as Bull-Bear Gauge Hits 9.7
3 articles · Updated · CNBC · Aug 7
Summary
Bank of America told investors to cut risk and rotate into defensives after its Bull & Bear Indicator climbed to 9.7 from 9.4, the highest reading since 2021 and well above its sell-signal threshold of 8.
Tightening financial conditions from rising bond yields drove the warning, with the bank favoring consumer staples, REITs, small caps, biotech and the U.S. dollar over banks, industrials and semiconductors.
$32.9 billion flowed into stocks in the latest week, including $9.6 billion into U.S. equities, while cash drew $53.7 billion and bonds $23.1 billion; high-yield bond inflows hit $4.1 billion, the biggest since July 2024.
Tech positioning showed early cooling as tech funds lost $0.7 billion and semiconductor ETFs shed $2.4 billion, though tech inflows still run at an annualized record $217 billion in 2026.
The bank still holds a broader long-stocks, short-bonds stance, but said higher yields with a weaker dollar—or yields rising as bank stocks fall—could signal a deeper shift from equities into bonds.